FIGURE 7-4 Xi Print Operates a Copy Business at Two

question 30

Multiple Choice

FIGURE 7-4 Xi Print operates a copy business at two different locations.Xi Print has one support department that is responsible for cleaning, service, and maintenance of its copying equipment.The costs of the support department are allocated to each copy center on the basis of total copies made.
During the first month, the costs of the support department were expected to be $200,000.Of this amount, $60,000 is considered a fixed cost.During the month, the support department incurred actual variable costs of $128,000 and actual fixed costs of $72,000.
Normal and actual activity (copies made) are as follows:

- Refer to Figure 7-4.For purposes of performance evaluation, fixed costs allocated to Copy Center 2 are

• A) $28,800.
• B) $60,000.
• C) $51,200.
• D) $24,000.

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Definitions:

Highly Compensated Employees

Workers who receive compensation exceeding a specific threshold, often involving salary, bonuses, and other benefits.

Financial Accounting Standards Board

An independent organization responsible for establishing and improving financial accounting and reporting standards in the United States.

Pay-As-You-Go Basis

A financial approach where expenses or charges are paid for at the time of purchase or consumption, rather than on credit.